Market Insights > First Look

First Look - Oil prices steady as trade talks progress, earnings loom

May Henry Hub is trading at its lowest level since December, ahead of expiry
- The prompt contract is down 7c this morning to $2.87/MMbtu, while Winter ‘25/’26 is down 6c to $4.21/MMbtu, and Summer ’26 is down 4c to $3.83/MMbtu (8:00 AM)
- Weather forecasts continued their warmer-than-average trend, with temperatures in the 11-15 day forecast period increasing
  - This would imply a loss of anticipated demand over the next two weeks relative to Friday’s forecast
- According to CFTC data, speculators in NYMEX futures flipped to net short after 15 weeks of long positions outnumbering short positions
Canadian producers focus more on gas in Q1 (BBG)
- In the first quarter, the number of licenses for new gas wells rose 26%, while new licenses for oil wells fell by 24%
- Producers are focusing on liquids-rich areas, which command stronger pricing
- An analyst from Enverus said, “We think condensate is a good place to be in the next few years as oil sands diluent demand ramps up.”
- Higher gas production in Canada can sometimes weigh on prices in the US, as cheaper Canadian gas gets sent south